Infrastructure Improvements Will Happen for Northern Colorado Water Suppliers, But They Will Come at a Cost

Residents of Northern Colorado will likely see a hike in their water bills over the next decade.

Although the national average for municipal water hovers somewhere around four-tenths of a cent per gallon, Northern Water in Colorado has proposed dramatically increasing costs per unit by over three times. 

The current projection shows that rates for Colorado-Big Thompson Project water could go from $28 to more than $100 per unit for municipal users. For agricultural users, the price would jump by eight times per unit, from $10 to $80.

The figures are courtesy of documents from the Northern Colorado Water Conservancy District.

Northern Water, which was established in 1937, currently provides service to 860,000 people on the Northern Front Range. They operate the federal Colorado-Big Thompson Project, which takes water from the Colorado River Basin on the Western Slope to the South Platte River Basin through a system of reservoirs and tunnels and is the largest wholesale water provider in Colorado.

The reason for the increases results from Northern Water’s expenses, which have surpassed their revenue in three of the last four years. Over half of their revenue results from property taxes, yet the water-rate revenue only accounts for 20 percent of Northern Water’s funds.

Although they have drawn from cash reserves in the past, this approach is seen as not sustainable by the agency’s board. This month, the board will make its decision on short-term rate hikes through the year 2018.

The potential increases will be to $52.70 for municipal users and $32.20 for irrigation users — the largest dollar increase ever for Northern Water. (As a spokesperson for Northern Water pointed out, the last double digit increases were in the 1980s.)

Although the hikes are intended to maintain infrastructure and may lead to greater water conservation for the area, critics say the move will increase pressure on farmers most of all.

One LaSalle farmer, Harry Strohauer, rents Colorado-Big Thompson water for $1,200 per acre foot. He says that the new rates could elevate the costs of his potatoes, onions, wheat and hay significantly.

Strohauer, like other agricultural customers, will have to receive water under one of two types of contracts: fixed rate or open rate. While fixed rates are based on decades-old contracts and will stay at $1.50 per acre foot, the open-rate assessment has already raised 9 percent for next year, and the 2015 rate will increase to $10.90 per agricultural unit and $30.50 per municipal unit.

Around two-thirds of Northern Water’s contracts are open-rate.

However, some in the area are more optimistic about what the price increase could mean. Drew Beckwith, water policy manager for the Boulder-based environmental group Western Resource Advocates, says that these increases can lead to good conservation in the future. While it may not immediately lower water consumption for many individuals, they will eventually take more steps to increase efficiency, such as installing new toilets and shower heads.

Additionally, the increased revenue means better upgrades to the water delivery infrastructure, much of which was built more than 60 years ago. It’s something that Northern Water’s operations desperately need, says one supporter.

“Look at all the investments that water providers did 100 years ago in our water system: new reservoirs, delivery systems and so forth,” said Tom Cech, director of One World One Water Center at Metropolitan State University of Denver. “That’s just the process of keeping up with the costs and population growth.”